A company provides the following information related to its inventory.

Inventory Number of Units Unit Cost Unit NRV

Item A $3,800$ $$52$ $$46$

Item B $4,200$ $$28$ $$30$

Item C $2,500$ $$34$ $$31$

Item D $1,300$ $$22$ $$24$

Required:

$1.$ Calculate ending inventory using the lower of cost and net realizable value rule.

$2.$ Based on your analysis, prepare the journal entry needed to adjust inventory.

Requirement $1$: Ending Inventory using Lower of Cost and Net Realizable Value

$($Use cells A$2$ to D$8$ from the given information above to complete this question. Use the MIN function to calculate the lower of cost or NRV$.$ Hint: To determine whether an adjustment is needed, use an IF function to compare cost and NRV$.)$

Inventory Total Cost Total NRV Lower of Cost and NRV Adjustment Needed

Item A

Item B

Item C

Item D

Total

Requirement $2$: Adjust Inventory to Lower of Cost of Net Realizable Value

$($Use cells A$2$ to D$8$ from the given information above to complete this question.$)$

Account Debit Credit

Cost of Goods Sold

Inventory